Personnel Management and Leadership Styles. A Look at the Leadership Styles Found in Practice and Their Effects on Employees

Table of contents

1. Introduction
1.1 Subject matter
1.2 Questions
1.3 Approach

2. Demarcation of terms
2.1 Leadership
2.2 Power
2.3 Leadership style

3. Leadership styles and leadership theories
3.1 Leadership styles
3.1.1 The patriarchal leadership style
3.1.2 The charismatic leadership style
3.1.3 The authoritarian leadership style
3.1.4 The bureaucratic leadership style
3.1.5 The cooperative leadership style
3.1.6 The democratic leadership style
3.1.7 The one-dimensional leadership model to explain the advantages and disadvantages of the leadership styles
3.2 Leadership theories
3.2.1 The Trait Theories
3.2.2 The contingency approach
3.2.3 The Path Goal approach

4. Intermediate result

5. Characteristics of a leader
5.1 The ability to self-assess
5.2 The ability to lead oneself and the will to lead
5.3 Trust and intelligence in leading people
5.4 Successful personnel management for everyone?

6. Motivation
6.1 The deficiency hypothesis of Abraham H. Maslow
6.2 The ERG Theory according to Clayton P. Alderfer
6.3 Herzberg's two-factor theory (motivation theory)

7. The impact of leadership style on the motivation of employees

8. Conclusion

Bibliography

1. Introduction

The primary goal of every company is and remains profit maximization. In times of advancing globalization and the newly emerged international financial markets, companies are forced, in the context of the current financial crisis, to rationalize, to engage in detailed financial planning, to cut costs and to think through each of their steps carefully. It is not uncommon for companies' tight cost-cutting programs to have a direct impact on their employees, who are often forced to make concessions and accept restrictions. You don't have to look far for current examples of this in recent days and months. Temporary and short-time work characterize everyday life in many companies. Of course, this is bad for the motivation and general willingness to perform of the staff, without whose labor, economic success cannot be achieved.

However, if one assumes that the long-term profit maximization of an organization also presupposes the unrestricted willingness of its employees to perform¹, this obviously contrasts with the respective cost-cutting measures for personnel. It is therefore very important, even in difficult times, to encourage and motivate staff in such a way that they are prepared to back the company in the market despite the restrictions that have been pointed out.

1.1 Subject matter

Without question, this task falls to the managers of a company. They are required to control and motivate the decisive competitive factor "human labor" in such a way that the best possible performance can be achieved. In the best case, it is possible to lead the employee to self-initiative and to goal-oriented thinking in the interest of the company. However, this task is anything but simple, because "... if you knew what causes an employee to work overtime without complaint, to be late frequently, to sabotage the supervisor's instructions, etc., you would have the key to influencing behavior in a way that enhances performance".²

However, leadership style is a decisive factor that can have an enormous influence on employee behavior. This was already proven by Lewin in 1940. In his Iowa study, an experiment that exposed various groups of students to different leadership styles, the correlation between leadership behavior and the subjects' willingness to perform was empirically proven.³

1.2 Questions

This thesis deals with the leadership styles found in practice and their effects on the subordinates within an organization.

The central element and question is the investigation of the increase in performance through appropriate leadership. It is to be examined to what extent the leadership style of a superior can cause an increase in performance of the employee and which effects this has on the motivation of the personnel. In addition, the question is to be pursued whether it is possible to classify "a good or optimal leadership style", or whether the leadership style and its effects are bound to different contexts and environmental influences.

1.3 Approach

In order to answer the question posed, the concept of leadership style and leadership will first be defined in detail, before various leadership styles and leadership theories are presented. After a sufficient theoretical understanding was created, the author hopes for first results regarding the central question of the present work. Thereafter, the author will additionally address characteristics, behaviors and personal traits that characterize a good leader. The knowledge gained up to this point will be used in Chapter 6 to make clear the effects of leadership style on the motivation of an organization's employees.

2. Demarcation of terms

Before the author goes into detail on the subject, this chapter will first define the most important terms, which are often not clearly distinguished from each other in colloquial language. This is unavoidable, if a scientific handling of the problem is to be ensured. Since the following section will refer primarily to leadership in companies and thus the subject of people management, the author deliberately uses the relevant business management literature to define the terms.

2.1 Leadership

Apart from the "one-man business", economic activity is a process based on the division of labor, which must be managed and coordinated. In every hierarchically structured organization, superiors (instances) have the authority to issue instructions and control the employees belonging to their department.⁴ While Hofmann understands leadership as "... the performance of person-related tasks"⁵ in companies, Staehle as well as Hentze and Brose use a more detailed description of the term leadership. They describe leadership as the targeted influencing of the attitudes and behavior of subordinates.⁶ In this context, leadership is understood primarily as an impulse-giving activity of a superior with the aim of having a motivating effect.⁷

Accordingly, the concept of leadership can be understood as the intentional control of subordinates/employees, which is connected with the purpose of achieving certain goals. This control presupposes that the superior is given the opportunity to exercise power and influence over his subordinates. This is guaranteed in organizations by a generally recognized hierarchy.

2.2 Power

According to Max Weber, power is "... any chance to assert one's own will within a social relationship, even against opposition, regardless of what this chance is based on”.⁸ Against the background of the given topic, power represents a sub-concept of social influence, which is legitimized by its general acceptance and thus, is accepted by the person concerned at least temporarily. Legitimate power refers, for example, to the power of superiors, due to their relative position in an organizational structure.⁹

2.3 Leadership style

"Leadership style refers to a supervisor's pattern of behavior toward employees who are bound by instructions”.¹⁰ However, this does not mean a situation-dependent or even variable action on the part of a manager, but rather a constant and relatively stable pattern of behavior that is shaped by the manager's basic personal attitudes. The leadership style of a manager can thus be defined as a characteristic feature of a manager that characterizes every leadership situation through a uniform behavior of the manager.¹¹

3. Leadership styles and leadership theories

Now that the most important terms have been defined, the topic will be explored in detail.

In the social sciences, there is probably no other topic that has been studied as intensively as the concept of leadership.¹² In connection with its leadership research, the human resources literature has developed various leadership theories and leadership concepts which, due to their diversity, cannot possibly be reproduced in the context of this paper. Instead, the most common leadership styles, leadership types and the contents of the relevant leadership theories will be presented below. This will serve in the following to make a statement that will reveal whether there is a "right" or "good" leadership style that is a panacea for problems that arise with employees in organizations. To this end, the author first directs his focus to the classic and traditional leadership styles.

3.1 Leadership styles

3.1.1 The patriarchal leadership style

Here, the role model is the authority of the father in the family, which is expressed in the absolute claim of the patriarch as the sole leader and his recognition by the led. In return, the patriarch's claim to leadership is linked to a duty of loyalty and care toward the person being led.¹³

3.1.2 The charismatic leadership style

Here, too, the claim to rule is given in the same way as in the patriarchal leadership style, so that both leadership styles have the broadest possible similarities. However, the charismatic leader relies entirely on his charisma and his extraordinary personality, which ensures him a mystical leadership strength unknown in the patriarchal leadership style. The welfare and loyalty obligations are not present for the charismatic leader.¹⁴

3.1.3 The authoritarian leadership style

Here, in contrast to the two aforementioned leadership styles, the focus is not on the person of the leader, but on the institution. The authoritarian leader uses a clearly regulated and hierarchically structured leadership apparatus. Characteristics are strongly disciplinary and structured elements. This leadership style is often found in large companies and social entities that require a tight organization. An example of this is the military.¹⁵

3.1.4 The bureaucratic leadership style

The bureaucratic management style represents a further development of the authoritarian management style. A particular characteristic is clearly regulated and delimited areas of responsibility. The arbitrariness of the autocrat is replaced by legality, regulations and professional competence. With the help of a refined system of authorities, a precise definition and delimitation of the respective powers succeeds.¹⁶

3.1.5 The cooperative leadership style

The cooperative leadership style is also referred to as participative leadership style. In contrast to the above-mentioned authoritarian leadership styles, the employees are involved in leadership decisions. Participation here can either take the form of a more consultative function, or it can take the form of democratic decision-making in which all participants take part.¹⁷

3.1.6 The democratic leadership style

If this leadership style is applied, it is up to the work group to decide which group member is assigned which task. The manager refrains from asserting leadership will and remains passive for the most part.¹⁸

3.1.7 The one-dimensional leadership model to explain the advantages and disadvantages of the leadership styles

As the following figure illustrates, the different leadership styles focus primarily on the question of what influence employees have on the leadership decisions to be made. R. Tannenbaum and W. H. Schmidt (1959) distinguish in their model between authoritarian and cooperative leadership styles.¹⁹

Abbildung in dieser Leseprobe nicht enthalten

3.1.7.1 Advantages and disadvantages of an authoritarian leadership style

The decisive advantage of an authoritarian management style is a clearly recognizable decision-making power, which thereby enables a high decision-making speed. The decisive disadvantages are a drop in the motivation of employees and their increasing lack of independence. In addition, the risk of wrong decisions increases because the decision-making process is concentrated on only one or very few people.²⁰ In chapter 4, the author will again deal separately with the topic of motivation in order to make this clearer.

3.1.7.2 Advantages and disadvantages of a cooperative management style

The advantages of a leadership style based on cooperation are, on the one hand, an increase in employee motivation through participation in the leadership process. On the other hand, the risk of wrong decisions is reduced, due to the professional assessment of decision-making processes by several people involved. In addition, work can be completed independently because employees are encouraged to think independently and creatively. However, decision-making processes become considerably more complicated and there is a risk of conflicts of interest. In addition, employees' self-discipline is a prerequisite for the application of this management style. If this is not given, work is prolonged and productivity decreases.²¹

...

¹ cf. Wöhe 2005, p. 172

² Staehle 1999, p. 219

³ cf. Straehle 1999, p. 339

⁴ cf. Wöhe 2005, p. 185

⁵ cf. Hoffmann 1997, p. 9

⁶ cf. Staehle 1999, p. 328

⁷ cf. Henze/Brose 1990, p. 22

⁸ Weber 1956, p. 28

⁹ cf. Straehle 1999, p. 398

¹⁰ Wöhe 2005, p. 185

¹¹ cf. Achleitner/Thommen 1998, p. 797

¹² cf. Steyrer 1993, p. 100

¹³ cf. Wöhe 2005, p. 185

¹⁴ cf. Wöhe 2005, p. 185

¹⁵ cf. Wöhe 2005, p. 185

¹⁶ cf. Wöhe 2005, p. 186

¹⁷ cf. Hoffmann 1999, p. 40

¹⁸ cf. Hoffmann 1999, p. 41

¹⁹ cf. Tannenbaum/Schmidt 1958, p. 95 -101

²⁰ cf. Schein/Bennis 1965, p. 173

²¹ cf. Schein/Bennis 1965, p. 173